Sheepmeat exports rose 35 per cent year-on-year for the month of February, with demand from China almost tripling.

This international demand, helped along by the Australian dollar sitting close to the US70c mark this year, is likely what is sustaining mutton prices, despite increasing supply.

The year to date, sheep slaughter is up 20pc on 2018, according to Meat & Livestock Australia (MLA), and while sheep prices haven’t been quite as resilient as trade lamb returns so far this year, they are holding up relatively well.

MLA market information manager Scott Tolmie said over the hooks mutton pricing was “pretty close to year ago levels”.

“Which is performing quite strongly considering how much mutton has come through the past 12 months, with export markets pulling product through supported by lower exchange rates,” Mr Tolmie said.

Angus Gidley-Baird, Rabobank, pointed to the high price of Australian lamb, and potential economic flow-on to China because of their trade stand-off with the US, as potential upside support for mutton.

“Exports of mutton to China are up 74pc for the first two months of the year,” Mr Gidley-Baird said in his latest commodity wrap.

“This may become a growing trend in light of concerns about the slowing Chinese economy.”

Both the light and heavy sheep over the hook national mutton indicators averaged higher for both January and February compared to last year, while the medium sheep price averaged marginally lower.

The latest figures for March show the over the hooks national medium sheep price averaging 390 cents a kilogram, compared to 402.60c/kg, a small difference given the ongoing drought and its consequences.

Saleyard prices for February medium mutton nationally averaged 396c/kg both in 2018 and 2019, while so far this month the national saleyard price is averaging 403c/kg, compared to 424c/kg last year.

In the east, Monday’s saleyard mutton indicator was at 385c/kg, dipping 16c/kg in the past week and 24c/kg below the same time last year.

Rodwells agent Nick Byrne, Bendigo, said while their mutton yardings hadn’t been exceptionally high for the time of year, he was surprised at the numbers still coming through the saleyard, given the obvious sell off of the past eight to 10 months.

“Three to four weeks ago we only had 3000 mutton in Bendigo, and there is the feeling around that number is what is to come, no doubt that will be the case through the winter time,” Mr Byrne said.

“The way the feed situation is, nearly everyone is scanning this year, and anything that is not in-lamb is going for someone else to feed or kill.

“There is not a lot of mutton to sell off in the next few months as this area is hoping to lamb in the next six to 10 weeks, so it will only be the 10-20pc scanning empty coming forward onto the market.”

Mr Byrne said pricing had been erratic as northern exporters came in and out of the buying gallery, but he thought it had reached the bottom.

“Historically the mutton market is still very good, particularly if you have weight in your sheep, even your 18-24kg sheep at around 400c/kg historically is not bad money,” he said.

“Nearly all the paddock feed except for the odd dryland lucerne stand is gone, little bit of irrigation happening but not as much as has been in the past – so the big carrot is only feed what is going to return you good profits in the next 12 months.”